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Home News Natural gas prices could improve

Natural gas prices could improve

According to the Calgary Herald, a leading financial expert is convinced Junior natural gas producers, might not have to wait too much longer for commodity price relief.

Josef Schachter, is the president of Schachter Asset Management and the Hearld says, he’s told the fall investment forum of the Small Explorers and Producers Association of Canada, prices have bottomed out and a meaningful recovery could become apparent as early as this winter.

He reportedly said a combination of shorter and longer term structural shifts are taking place, that will once again establish sustainable natural gas prices at a level that allows producers to recover costs and even turn a profit – albeit at lower prices than two years ago.

At the same Calgary forum Monday, Jeff Tonken with Birchcliff Energy, reportedly said his company plans to move full speed ahead with an aggressive development program in its Montney-Groundbirch core area. In the past that company has spent 77 million dollars to build a new gas plant capable of processing 60 million cubic feet per day.

The newspaper quotes Mr. Tonken saying, in his own presentation, "We’re bullish on gas because we have very low operating costs, so we can make money with gas at three dollars and 50 cents."

That’s less than half of what has generally been considered the price necessary to instill confidence in producers to up their drilling programs.

For a look at the entire article from the Calgary Herald, click here.

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